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I think you'd just get a fine if you didn't have it. It's not really a license, just an official translation of your license. You have to carry both.

When I moved to Italy, it took me about 14 months to get my Italian driver's license. I had an IDP which expired about two months before my scheduled road test. I ask our local marshall of the carabinieri if I could drive with my valid US license and an expired IDP, because after all the translation was still the same. He said that by law I couldn't. Since I was planning to apply for Italian citizenship, I didn't want to risk a blot on my escutcheon, so I just didn't drive for two months.

During the time I was driving with the IDP, I was asked to show it at least once that I remember. I've heard of people who were unable to pick up rental cars because they didn't have one.

I agree, I think it's a rip off to need a new one every year when your actual license is still good. One time the person filling it out at AAA made a mistake on the date and just 'fixed' it. Looked like I had changed the date myself - leading me to wonder if that wouldn't work. If you got stopped they'd want the 'translation' of the IDP but it would be the real license they would be checking for validity.

The last time I got an IDP the clerk didn't write an expiration year, so I was able to use it for many years. I'll need a new one now that I have a new DL, but I am going to ask if they can skip putting the expiration year on the IDP. Can't hurt to ask, right?